In late July, 37 of 42 researchers funded through the ' individual investigator grants program got a huge shock. The iconic charity informed them via email that their funding had been terminated, retroactively to June 30.
The grants averaged about $300,000 during a 3-year period, with a total of about $3 million dollars withheld, and most researchers were still midway through their grant cycles. Many had already spent money in anticipation of March of Dimes funds owed under the grants that the organization was late in paying.
Sources contacted for this story remarked that they had never heard of a funding source unilaterally ending funding retroactively for reasons not related to the grantees' performance. They also said that without the ability to find other replacement funding, many of the affected researchers might have to lay off staff, euthanize lab animals, and suspend their research -- research that had been considered meritorious enough to be funded in the first place.
But while the announcement came "out of the blue," as one researcher put it, the March of Dimes' financial troubles had been brewing for a long time.
Evolution
The March of Dimes was founded in 1938 by President Franklin D. Roosevelt as the National Foundation for Infantile Paralysis (NFIP) to combat . Entertainer Eddie Cantor coined the name "March of Dimes" to reflect its national campaign for every individual to contribute 10 cents. A year after Roosevelt's death in 1945, the dime was redesigned to honor him. The organization's name was formally changed to the March of Dimes Birth Defects Foundation in 1976, and in 2007 it was renamed again as the March of Dimes Foundation.
Long before then, the group had already begun . In 1958 -- only a few years after the Salk vaccine was introduced, but already seeing that it would virtually eliminate polio -- the NFIP announced that it would henceforth focus on preventing birth defects. Over the succeeding decades, it morphed again to include prevention of premature birth and infant death. Its .
With that evolution over time -- polio was a front-page national crisis akin to a war, a status that birth defects and preterm birth have never achieved -- came a long decline in the March of Dimes' revenues.
A noted that March of Dimes raised $67 million in 1954 -- $628 million in today's dollars after adjustment for inflation -- at the height of the polio crusade.
"Since then, the charity struggled periodically, partly a victim of its early success," Barrett wrote. By 1968, donations had fallen by two-thirds from the 1954 peak and barely kept pace with inflation over the next 40 years.
Revenue in 2017 was $157 million -- accounting for inflation, exactly one-quarter of the revenue it enjoyed in 1954. And that was a sharp decline from just a year earlier, when the March of Dimes took in $172 million.
For the prior years from 2007 through 2015, Form 990 federal tax submissions reported steadily declining revenues each year.
Worse, those reports show the organization ran deficits from 2012 to 2016. , with an operating surplus of $3.6 million.
Last year also saw the March of Dimes announce that it would sell its long-time headquarters building in White Plains, New York. This spring the group said it would relocate to Arlington, Virginia.
Then, in 2018...
In May, the March of Dimes She had been recruited from Washington University School of Medicine in St. Louis to lead the strategic direction and oversight of March of Dimes research. Her predecessor, Joe Leigh Simpson, MD, left the organization suddenly in January.
It was only a few weeks later that the group rescinded the research grants.
Andrew Holland, PhD, a molecular cell biologist at Johns Hopkins University who only received about one-third of a $250,000 grant, was studying the genetic causes of , a condition that causes children's heads to be significantly smaller than expected.
"I received an email completely out of the blue regarding news about my March of Dimes grant and read in horror that my funding had ended," he told 鶹ý during a phone interview. He said the organization had been late in making payments and that it still owed him about $40,000 from prior payments due.
Holland said the March of Dimes had the most opaque funding process he had ever encountered, that none of the grantees were told who else had secured grants, and there was little information about the review process.
"I was also shocked to learn that even though 37 of us lost our funds, March of Dimes had sent out requests for proposals a few months earlier and still intended to fund some new grants."
He said that the fate of his microcephaly research -- including two positions and a very large research rodent colony -- was uncertain and although Johns Hopkins was helping with some bridge funding, it would take considerable time to seek new funding.
"The situation is catastrophic and will cause a massive amount of waste," Holland said.
Unprecedented
Marc Kastner, PhD, president of the -- a coalition of nonprofit institutions and foundations dedicated to increasing investment in basic science research -- told 鶹ý that he had never heard of a philanthropic organization reneging on its commitments.
"Our alliance only works with organizations that are foundations with significant endowments or with principals who have great wealth, but they are just not going to take the chance of embarrassment by not fulfilling their commitments."
He noted that the March of Dimes is different because it's a charity rather than a philanthropic organization and has to collect funds first before dispersing them.
"However," he added, "there are many charities like that and I have never heard of them reneging," said Kastner, a former dean at the Massachusetts Institute of Technology. "It's a very, very bad thing to do because research is such a long-term effort and a principal investigator has to make commitments to graduate students and post docs, and if money is suddenly cut, it could be devastating."
He said that there have been some cases where the NIH has reduced funding in subsequent years on a 3-year grant with a continuation proposal that might not provide funding at full level.
"That has happened, but it's very different from making a grant for so many years for so much money and then just cutting it off."
Kastner also pointed out that this is the first time since World War II that philanthropy has become as important to basic research funding as the federal government.
鶹ý also reached out to Maryrose Franko, PhD, executive director of the (HRA), a collaborative organization of nonprofit research funders committed to maximizing the impact of biomedical research to improve human health.
"I don't know of any other instances when academic researchers have had their funding terminated retroactively," she said in an email.
Many of her association's members do not have to fundraise because of endowments, she said, but that based on data collected in the HRA's awardee database, HRA members are contributing more rather than less toward biomedical research grants.
Explanation
Although Moley had granted interviews to several news outlets after the grant rescission was announced. the March of Dimes declined a request from 鶹ý.
An Aug. 3 statement from the organization said in part, "[G]iven our overall resources, March of Dimes has made the difficult decision to reduce grant awards to researchers whose work does not directly impact the prevention and care of premature birth. We have had to carefully evaluate current and prospective research programs to ensure we are targeting very specific programs to meet very specific health objectives around reducing preterm birth rates. March of Dimes is committed to fighting for the health of all moms and babies and is doing all we can to ensure we have the ability to fund solutions to the biggest threats facing moms and babies today and in the future."
In the published interviews, Moley said that the March of Dimes was "transforming and modernizing its operation," and that the funding cuts were an effort to trim $3 million from the organization's $20 million annual research budget and were due to a budget shortfall. She added that the cuts were a result of declining donations, especially from its March for Babies events, citing competition from other similar events.
An insider who asked not to be identified told 鶹ý that Moley may not have been aware of the organization's desire to terminate grants when she accepted her position. According to this source, Moley said the March of Dimes was in a dire financial state that would not be made public, and that she was under orders by its president, Stacey D. Stewart, to cut the funding.
View from Outside
Nancy G. Brinker -- a global cancer advocate and founder of the breast cancer charity -- told 鶹ý that she was saddened to hear about the situation with the March of Dimes.
"I love the March of Dimes and its historic mission is part of my DNA. In fact, my sister Suzy and I grew up raising money for polio research and the work of the March of Dimes was very much in mind when Komen was created in memory of Suzy in 1982," she said, qualifying that her comments were her own and do not necessarily reflect that of Komen's current leadership.
She said that Komen's early founders believed a reserve fund should always be in place to pay for outstanding research grants to protect the ongoing work of scientists.
"But that was several decades ago and today the philanthropic environment is very different and all charities face more competition raising money, especially with recent tax changes that limit deductions for charitable giving."
Brinker said that she didn't know much about the specifics regarding March of Dimes, but suggested that it would be beneficial for more not-for-profits to collaborate to reduce overhead and expenses in order to help fulfill their respective missions.
Note: Brinker has co-authored articles with Eric Rosenthal for The Hill.